Ten Supply Chain Considerations for 2019

by | Jan 21, 2019

With 2019 now very much underway, the Supply Chain Academy looks at the main factors that are likely to impact the supply chain this year.

Brexit
No surprises here. On the 29th of March, Brexit may or may not become reality. The UK cannot reach an agreement and the Prime Minister ‘s latest deal was rejected. The UK could reach the deadline with a new deal, with no deal, with a new government, or even with a new referendum – we just don’t know. What we do know is the situation is already affecting the supply chain, whether that be through stock piling or the lack of investment due to an uncertain future.

Global Politics
Brexit isn’t the only global issue right now. A major international trade spat has developed between the two largest economies in the world. Tit-for-tat tariff hikes have been applied by the US and China on each other during recent months, resulting in unusual volumes spikes.

Carriers & Costs
Numerous carriers invested in mega vessels, capable of carrying 20,000+ twenty foot containers, based on predicted growth in global economies which has not yet materialised. The vessels have been entering the market over the past eighteen months, which could mean continued fluctuation in ocean freight rates to align with supply and demand. Increased fuel costs and the IMO’s introduction of low sulphur regulations for container ships, by the end of this year, may also be a factor.

Port and Transport Congestion
UK port congestion and container transport had a major impact on last year’s retail peak season. A number of factors contributed, but the influx of mega vessels, driver shortages and poor infrastructure were probably the most significant. These issues stretch beyond the UK and have also caused supply chain disruption in the US, Europe and Asia. 

BRICS 
The emerging nations of BRICS (Brazil, Russia, India, China & South Africa) are becoming more strategic. GDP growth rates of over 6% means that trade to and from BRICS should continue to increase, with major international companies expanding their logistics capabilities in these countries.

On-Line Market Share
Online retailing is expected to continue to increase in market share, where companies such as Amazon and Alibaba are going from strength to strength. A whole host of big name retailers have struggled over recent times, as the cultural move away from high street shopping, and towards buying on-line, is showing no signs of slowing down. 

Internet of Things (IoT)
The internet of things – the connection via the Internet of computing devices being embedded in everyday objects – looks set to be at the forefront of supply chain innovation, with predictive analytics growing as a means of running real-time intelligent supply chains. 

Blockchain 
Major corporations are already commissioning blockchain projects, with supply chain processes deemed as a great place to start. Track and trace, compliance and fraud protection are all predicted to benefit from blockchain, where information is delivered more securely, faster and with more transparency.

Robotics Process Automation (RPA)
Robotics already have a vital role to play in the supply chain and major e-commerce companies are making the most of the technology. Fulfilment centres with robotics boast a 50% increase in capacity and the use of robotics is expected to increase through 2019.

The Rise of Supply Chain Leaders
Supply chain leaders are becoming more strategic and with the right skill sets are able to deliver greater value to their companies. Supply chain management and its execution is becoming a differentiator for companies who seek to leverage it to their advantage. With the uncertain nature of the global supply chain right now, 2019 may be the time for the educated supply chain leader to rise to prominence. 

The Supply Chain Academy, and our sister company CP Training, continue to deliver outstanding supply chain capabilities to business through executive masterclasses, bespoke training, thought leadership events, career pathway and the new degree apprenticeship. We are able to provide unique insight into supply chain innovation and the necessary skill sets to manage supply chain disruption.  2019 certainly looks like a great time to invest in your supply chain capabilities.

For further information on how our products can add leverage to your supply chain, please call 01708 259450 or email info@supplychainacademy.org.uk

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